Bishops Stortford leases on residential deteriorating in value. if your lease has about ninety years remaining, you should start thinking about a lease extension. If lease term falls under eighty years, you will then have to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to your landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Flat owners in Bishops Stortford will usually qualify for a lease extension; however a solicitor will confirm your eligibility. In certain cases you may not qualify. There are also strict timetables and steps to comply with once the process has started so it’s prudent to be guided by a conveyancing solicitor during the process.
Leasehold residencies in Bishops Stortford with over one hundred years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with handle Bishops Stortford lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancer we work with provide it.
During the course of the last few months Ryan, came critically close to the 80-year mark with the lease on his one bedroom flat in Bishops Stortford. In buying his property 19 years previously, the length of the lease was of minimal importance. Luckily, he became aware that he would soon be paying an escalated premium for a lease extension. Ryan was able to extend his lease just under the wire in September. Ryan and the freeholder subsequently agreed on an amount of £5,000 . If he not met the deadline, the sum would have increased by a minimum £1,025.
In 2012 we were e-mailed by Mr and Mrs. R Phillips who, having bought a ground floor flat in Bishops Stortford in January 1996. We are asked if we could estimate the compensation to the landlord could be to extend the lease by an additional years. Comparative premises in Bishops Stortford with 100 year plus lease were in the region of £254,200. The average amount of ground rent was £60 invoiced per annum. The lease ran out on 27 April 2077. Taking into account 51 years unexpired we calculated the compensation to the freeholder to extend the lease to be between £43,700 and £50,600 not including legals.
In 2011 we were contacted by Mr D Davies who, having purchased a one bedroom apartment in Bishops Stortford in January 2001. We are asked if we could estimate the compensation to the landlord would be for a 90 year extension to my lease. Comparative flats in Bishops Stortford with a long lease were worth £215,600. The average ground rent payable was £45 invoiced per annum. The lease finished on 23 April 2088. Considering the 62 years outstanding we calculated the compensation to the landlord to extend the lease to be within £18,100 and £20,800 not including costs.